The Pawn Shop Debacle

It was about 9:30 last Friday morning and I was just firing up the compressor for a round of framing on the master bedroom addition I’m building at a friend’s house. Well, trying to fire it up, anyway. When I plugged in the beefy machine and braced myself for some noisy chugging, I was greeted with silence instead.

“What The Feather!?”, I cursed as I checked the cords, switches and settings. I eventually found a flaw in its power cord and fixed it, and we were back in business. For about two minutes, at which point I realized the motor was running constantly and never shutting off. There was yet another problem with the machine, this time a broken pressure regulator. Air was hissing out just as fast as the cylinder could pump it in, so it would need to run constantly to maintain the 100PSI that I need for the nailguns.

It has been a bad winter for compressors. In Hawaii, Johnny Aloha and I blew an old Craftsman when he overworked it running an air chisel to chip away part of his asphalt driveway. So we had to borrow the next door neighbor’s crazy old barrel unit. While it did get us through the rest of the project, it too was leaky and inconvenient to use. When I got home and started working on this addition, we started with my friend’s venerable Bostitch compressor which has run reliably for the 5 years since he bought it off of Craigslist. On the first week of the job, it blew its cylinder gasket and lost pressure. So I brought over my heavy-duty trolley-mounted Dewalt compressor, thinking that would be the end of the issues.

So when even my 4-years-new Dewalt started acting up right at the beginning of this workday, I was naturally pretty peeved. With nowhere left to turn, we limped through the day with that machine, manually switching it on and off as needed to handle nailing sessions as we installed the sheathing on the newly framed walls. I became increasingly annoyed at the compressor as the day went on, finally cracking and uttering the following Antimustachian utterance:

“We need a working compressor right now. I don’t have time to fix this, so I’m going to check Craigslist and try to buy a new one tonight. Then I’ll just give this one away on freecycle – someone else can fix it, and my time is too valuable right now to be the one to do it.”

I checked Craigslist. There was a great Ridgid compressor for sale right in Longmont. Brand-new condition, reasonable price. I sent a text message, negotiated the price, and got a call from the owner.

“Uhh, hi. This is Trisha. You see, I’m selling the compressor on behalf of my husband, who no longer needs it for work. But the thing is that it’s at the Pawn shop. I pawned it last night to get a loan because we’re short on cash. You’ll have to meet me at the pawn shop to pick it up”.

At this point, I was shocked to learn something that everyone else apparently knew about pawn shops: when a seller brings in some merchandise, the pawn shop doesn’t buy it outright. Instead, they issue a “loan”, for about one third of the value of the item, and promptly tack on the state-regulated maximum 2% monthly interest fee, and about 20% of miscellaneous bullshit additional fees for “storage and handling”. The customer then needs to come repay this loan, or renew it monthly with additional fees, if they want to maintain ownership of the item. The total cost can be upwards of 200% in annualized interest per year. If the customer fails, the shop owns the merchandise, and they bring it out to the sales floor to sell to someone else (often done on a “rent-to-own” basis if they can find another sucker who is bad at math!).

Now WHY, you may ask, would anyone pawn an item for 30% of its value, when they could just sell it on Craigslist for 100%, while dealing with much nicer people? It is one of the mysteries of our society – those information gaps that keep poor people poor – just like the idea of “financing” a car or running a credit card balance. Pawn shops are designed to prey on poor and undereducated people by ripping them off. Great business model!

“Oh boy, here we go”, I thought. If this information had been correctly explained in the Craigslist ad, I never would have responded. But since I was already invested in the deal, I made the foolish desicion to play along. I made a date to meet Trisha at the EZ-Pawn up on the seedy part of North Main Street at 5PM. I showed up with the Scion xA and a wallet full of cash. “At least I might get a nice story for the Mustachians out of this”, I thought.

I met Trisha in the parking lot – she had just come from her job in Denver, apparently commuting in a black full-size V-8-engined Chevy pickup truck. We entered the store.

Inside, there was the usual display area of outdated electronics, Walmart bicycles, and some surprisingly good tools. A long lineup of unhappy-looking people shuffled along at the cash register. I perused the tools and answered some emails on my phone until Trisha got to the front of the line and explained her request to the cashier/manager.

“Okay Miss”, said the manager, “the compressor is in storage, so in order to see it, you’ll just need to pay the full balance of your loan plus all the fees”.

“But I don’t have the money for that”, said Trisha. “I used that money to buy gas on the day I pawned it. But this guy here has got the money – he’s willing to buy the whole thing! Just bring it out so he can see it”.

“I’m sorry, I can’t bring it out until I have the money”, the manager repeated.

“But I can’t give you the money until I see and test the compressor”, I explained. “Can’t you make an exception so we can get this sale done?”

“Nope. The compressor is MINE now, until the loan is repaid”, said the manager, getting a little surly.

“Well, my apologies to both of you”, I said, “after learning about a policy like that, I can’t do business with this shop even if you did change your mind, so I’ll be off now”. And I left.

A few minutes later, Trisha called my mobile phone again.

“I talked to my mom, and she says if I drive over to her place, she’ll loan me the money to get the compressor out of the pawn shop. If I do that, and then bring it over to your house, will you still buy it?”.

“I appreciate the offer, but if you don’t mind let’s just call the deal off for now. Best of luck to you and I’m sorry again!”.

Whew. I spent some more time that evening shopping online for brand-new compressors. Then another friend came over, we drank some beer, and he mentioned I could just borrow his compressor for as long as I needed it, taking the pressure off of the purchase completely. Why didn’t I think of that before?

The next day was Saturday. With the loaner machine procured, I decided I now had time to try to fix my own compressor. I did a little bit of research. It turned out that I could use an external regulator to work around the problem. That would cost only $48.23 from Amazon with free shipping. That’s a lot less expensive than buying a new compressor. But wait – digging deeper I found you can get a Dewalt regulator repair kit at amazon or ebay for only $23. That’s even better. And it looks really simple too.

That gave me an idea. I took the 3-minute walk down the street to the construction site, and wheeled my trusty Dewalt home. And within 5 minutes, I had already learned something truly valuable:

How to Fix a Dewalt Compressor Regulator*

I detached the regulator unit from the front panel using a star-shaped ‘Torx’ screwdriver bit.

From there, I was able to pull it out of the frame so I could get a wrench onto the nut that holds on the pressure-adjusting knob.

Inside, I saw a spring thing, a metal pin, and a rubber seal. But the spring wasn’t very springy. “Hmm, that’s a clue”, I thought.

I pulled the three pieces apart, sprayed some silicone lube onto them, and reassembled. Now the spring was springy. “That will probably work better”, I concluded.

I re-tightened the nut and fired up the compressor. The air leak was gone and the adjuster knob turned better-than new.

Not only did I save about $300 and a whole bunch of environmental waste, but I will now know how to fix air regulators for the 70 remaining years of my life! And the whole thing took less time than a single visit to the pawn shop.

Let this be a lesson to me. I must not start getting all high and mighty with that “my time is too valuable to spend fixing my own shit” nonsense. As explained in the article about the value of your time, these equations only favor the lazy in the case that you have near-infinite wages in your day job, or already-infinite knowledge of everything and thus you cannot benefit from the learning experience of fixing your own stuff. At least give it a try.

And oh yeah, the other lesson: pawn shops are ridiculous. Help me convert the rest of the world to Mustachianism, so we can have them all torn down.

* (I made a heading out of it, so we can be first in the search engines with this result – apparently nobody has ever written about this before!)

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I have been in a similar situation where I had some friends in family in town to help with a renovation project and had a tool go out right at the most in opportune time. I had that sense of panic because I knew time was a factor (they would only be here for the day) and they didn’t want to wait around so I could get a ‘deal’ on the tool.

I think the hardest part was going to the local flea market the next weekend and seeing the same nail gun for about 1/10 the cost. Luckily, it wasn’t very expensive compared to a compressor but I still felt the pain.

I think the biggest thing I learned too was that several other people I know, not the best of my friends, had the exact same tool. I think in the future I’ll be a little more thoughtful when I have projects with others helping about having everything ready to go and potentially a back up. I know when I have few options I will be paying more.

I agree 100% about your being prepared ahead of time. I make it a habit whether it is just to swap out brake pads or build a new deck – get all the equipment out a couple weekends before you want to start and check everything for proper operation. That also ensures you know where everything is.

You can straight up sell stuff at a pawn shop instead of pawning it — or at most pawn shops, at least — but you won’t typically get a very good deal on it. It’s far better to sell it yourself on Craigslist, eBay, or the like.

Pawn shops are an incredible rip-off! When I was an expat in Hong Kong, I used to see pawn shops all over the place even in the top tier neighborhoods so I assumed that they must be giving people pretty good deals.

So when I was moving back to the US, I went to a pawn shop with a laundry list of items to sell. The first item on my list was my less than a year old 40 inch LED Samsung TV which I bought new for $1100USD. The price they gave me was $160USD. I was so stunned that I walked out without asking them to give me quotes on the rest of my list. They were shocked as well because they guy was smiling at me and said “Great price right? I come pick up right now.”

I told my husband that night that I would rather donate the TV to charity than let those thieves take it. Luckily for us, someone in our building offered to buy it for $600USD so we sold it to him.

Pawn shops offer crappy prices worldwide. But sometimes it is the only option. Even in a cosmopolitan city like Hong Kong, craiglist, eBay, are not commonly used.

People seem to be forgetting the other side of pawnshops. They are a GREAT place to purchase certain things. I always check pawn shops when I need tools because I can usually find them cheaper than craigslist. They also have decent deals on TVs sometimes too.

I own a pawnshop. What you guys seem to be forgetting is how financing works in everything. Time has value with money. You walk into a shop and want money for your stuff right now as compared to waiting to get it when you sell it yourself. There is a cost associated with that. You of all people should know that. As for preying on people, my shop fills a niche that would otherwise not be available to quite a large swath of the world. Most people have such poor credit that they wouldn’t get a second glance from a bank for a loan. Especially when life happens. And as far as taking advantage of people goes, during the year I’ve been open, I’ve invested around $200k into a building, renovations, labor utilities and various other forms of overhead and the only people that have made any money on all of this are my employees and the government. As for the merchandise, I can’t understand why anyone, even the wealthy, wouldn’t buy some types of items from a pawn shop. Tools and guns top this list. I’m not trying to suggest a pawn shop is the preferred place to sell or get loans, but it is a last resort for those that have no other options. Because the risk is so high, the cost is also. I regularly tell people that talk to me about “what would you give for a ________” that if they don’t need the money right away, they should sell it themselves. I’m not buying it to use it, I’m buying it to make money from its resale. If that offends, take it up with the law of supply and demand.

People do the loan thing because they believe they might get the item back. It’s like an insane extension of buying things on credit: putting the things you already own *back* on credit (and without even owning them for the duration).

If you don’t need something anymore, sell it, and you’ll get more money. If you do need it, keep it. Not much of a middle ground there.

“What the feather”? For a second I thought someone from the PC police hacked your site! Great article, especially about how all of us should take a moment and try to solve the problem and not just throw something away and buy a new one. Would have loved a photo of the pawn shop owner. Sounds like a real tool.

AU contraire Tico! Profanity is an absolute necessity! It is critical when expressing (in situ or by the written word) pain, anger, frustration or even excitement! I enjoyed this article in Scientific American:

Take note of the last paragraph in S.A. – I would agree – traditional profanity is best served up sparsely lest the word lose its potency! Sometimes words like fuck and shit (or their cousins like fuckity, shitty – yes you can even bold or italicize words for greater effect) don’t invoke the same literary punctuation that an author would like to convey.

The situation being described may transcend the potency of traditional profanity – resulting in new words being substituted. Thus, you should see “What the feather” as something far more profane and offensive that a plain old “What the fuck”. Especially in the context of a high quality tool that has performed reliably in the past with no damn good reason to fail.

THANK you, Ottawa! Every flapping time Mr. Money Mustache tries to invent a new swear word, I get groans from the badasses, accusing me of wimping out on language, and well-meaning but misdirected thanks from the sunday school teachers, thinking I did it to try to appease a more conservative audience.

Swear words are the hot spices of language. Sometimes, coming from someone like Mr. MM who routinely uses them, the switch to something like “feathers” can have even more power.

And swear words are nothing if not powerful. The great irony, of course, is that 100% of that power is invested in them by those who are offended. Without those offended by it, the word ‘fuck’ becomes just another arrangement of four letters.

Pawn shops are the absolute worst. Once I was on tour with a ballet company and saw an INCREDIBLE trombone (well, if you are trombone player like me it was incredible) in a pawn shop. I bought it immediately for next to nothing. Later that evening my friends and I went to see a big band (can’t mention the state here) and we met the musicians backstage for a beer. The trombone player told me he lost his trombone and was playing on a piece of garbage. Apparently, he dropped his horn off at the pawn shop every week for some cash…he would gamble the money at the casino and hopefully win enough for food that week…then he would go buy the trombone back. Well, this time I bought it. Ugh. I gave it right back to him on the spot. What a freaking story. This was about 20 years ago…I forgot about it until this post. Please don’t think poorly of us bone players…

As for the compressor..I’ll take your word for it, dude! Not touching one of those!

Ha! Jason, that’s right! Sometimes low tech is the only tech. But, I’ve owned a used Kobalt (lowes brand) compressor for metal work and painting for awhile, and when you’re busting something out commercially, a compressor is one of the most important tools possible.

RE: pawnshops. They’re only great for the pawn shop owner, but since we live in a country that struggles with vision beyond the steering wheel, I’m afraid pawn and payday loan shops will likely thrive for at least a couple of decades.

My hope is that microfinance organizations like Grameen America will help to put these predatory lenders out of business. Check out Banker to the Poor at your local library to hear about the amazing things Grameen did in Bangladesh.

Haha.. I was wondering if I’d get any flack for the nailguns. It would certainly be manly to hand-drive all the nails in an addition, but my friend wouldn’t be too happy about the schedule impact. We put in over 1000 nails on that day alone (the OSB sheathing gets one nail every six inches on the boundaries, one every foot on the interior studs). The gun is at least 10x faster than manual nailing, and gives much higher-quality results as well.

Agree. It’s amazing to watch the speed of the roofers now-a-days. Helped my dad sheath and shingle several roofs back in the day (before guns).

Thanks for the post not long ago detailing your expenses for last year. It inspired me to call my home owners insurance agent and it looks like I’ll be paying a lot less this year. I still don’t understand how you pay under $400 for the year for home owners. An article on the particulars would be interesting. Maybe you can insure for less than replacement since you own it outright. Otherwise, I don’t get it. Anyway, thanks for the details… they helped.

Also, if one is doing a great dealing of hammering nails by hand over the course of many years, one could develop “contractor’s thumb”. That’s a term I just made up, but the condition is for real: my father-in-law worked his way through grad school building houses, then built his own house, etc, etc. A few years ago his thumb just kind of stopped working. He finally came to terms with it when he tried handing his son a drink and instead spilled it everywhere on account of the not-working-thumb.

Totally – hammering nails manually is pretty much the most dangerous thing a carpenter does (or used to do, before these wonderful nailguns). I actually broke the tip of my thumb bone a few years ago with some ill-fated manual hammering (luckily it has healed fully). Even if you’re really skilled and careful, it only takes one missed blow out of thousands to do permanent damage.

We once helped a friend replace the roof on his house, and since their finances were so incredibly tight, they handed us each an apron of nails, and ONE hammer. It was a small & slow assembly line, and it sucked! We had a compressor they could borrow, but no one had a roofing nail gun.

Later that day, we happened to be in Big Lots, and found a roofing nail gun for cheap, made cheaper by my love of coupons. Our friends wife would still not allow the purchase, but we were able to barter it for some electrical work we wanted done on the house. The roof progressed much faster after that!

I feel sorry for Trisha… she is obviously stuck on the treadmill of debt and has no idea that she is only making it worse! I wish we had magic wands for those kind of situations to just instantly make them come to their senses! Alas, I know we can’t educate the people we barely know – they won’t be too receptive to the kinds of things we talk about right away.

Funny only a perceptive person like MMM would make the connection between a big expensive car and the pawn shop, most people would blast one side (lady or pawnshop) or the other depending on thier political bent.

BTW MMM we’re in the process of replacing some appliances and thanks is to your posts I’m looking beyond price and size and looking at power consumption. Two simularly priced units up to 50% difference in energy consumption!!!!! Running the math on break even costs – we live in an area with expensive hydro (electricty)

Before would never have really occurre to me to look at this.

Second point we’re in the process of moving and rather getting of old stuff and buying new stuff we’re selling the stuff we can’t take and what we do need to buy we got everything used!!!!

I loved this story. It is great to see an example of an eloquent solution to a problem; it opens us up to believe that we can solve our own problems, if we can just slow down and allow the answer to come forth. Your story reminds me of “The Alchemist” by Paulo Coelho and in that story there was also an exciting and interesting adventure (like the pawn shop learning experience)!

I’m not much into power equipment, but I enjoyed this story and maybe this can help if there is ever a problem with the air compressor in the garage. Thanks, MMM!

I’ve been into a pawn shop a few times, looking for old nintendo games, and record players. I’ve never pawned anything, but I think you are also able to just sell them things. Depending on the items, and how quickly you are wanting to offload them, it could be worth it.

“‘At least I might get a nice story for the Mustachians out of this’, I thought.”

If the best thing you can say about a financial transaction is it might be good for a laugh, run away!

I once took on some side work under really strange circumstances: the story was just so odd that I figured “what the hell?” and went along with it. It ended up with me being roped into some shady client work, pulling the plug, arguing over billable hours and ultimately writing off an invoice. Waste of time and money. My family lovingly calls this episode “Mafia Coffee.”

Why would I want to possibly anger the Mafia? I think I’ve already said too much :)

You got the gist of it though: I allowed myself to get caught up in something I shouldn’t have: nothing illegal, just very shady and unethical. I backed out as soon as I realized there was an issue, but one of the parties was less than pleased with that.

I think this is a good illustration that a lot of people remain uninformed about their options for buying and selling items, which is really too bad for both their psyches and their pocketbooks.

Having a bunch of television shows that seem to glorify the pawn business doesn’t help, and there remains a high correlation between being uninformed about life’s options and watching television.

I recently joined local free-cycle group because I had a bunch of old things to give away (beer making equipment anyone?) What I learned was that the torrent of offers to give things away is amazing, and one could practically furnish a house in a few weeks for virtually nothing if one wanted. Yet I am fairly confident that one of the reasons Trisha is in the financial straits she is in is because she bought a lot of fancy new consumer objects that she likely saw on television.

Dragline you are SOOO right! When I moved into my current rental which is much bigger than my previous I did just that. Got 3 free tvs, a free microwave, a free bench for the entryway, numerous free clothes, framed prints and more. Did I say FREE?? It has been amazing.

The way it works here is that pawn shops offer secured loans to their victi–*ahem*, I mean customers. They use the pawned item as security for the loan. If the person pays off the loan they get their stuff back; if they default, the pawn shop takes ownership and can sell the stuff to someone else.

You can also just sell things to the pawn shop. But lots of poor people pawn items they don’t intend to actually lose as a way to generate quick cash for paying rent, buying food or whatever it is they need at the moment, with the expectation that they’ll then pay off the balance over the coming weeks/months and get their stuff back. Doesn’t always happen and a lot of people lose family heirlooms (not to mention lots of money) that way.

The pawn shop determines the value of the item that you pawn and that item is collatoral that they hold in storage for a loan equal to the value of the item. When you repay the loan, interest and fees, they return the item to you.

Pawn shops in Australia are the same as everywhere else. You can get a secured loan for a fraction of the value of the item you want to pawn. If they don’t offer loans then it is a second-hand or consignment store where they directly buy the item from you.

I did pawn a bunch of DVDs, CDs, and some small appliances once. I got sadly little for them. But I was moving to another state and was basically holding a firesale to downsize all the crap I had accumulated over living 7 years in one place. Several lessons were learned:

– Pawnshops rip you off if your selling stuff.

– Pawnshops may have descent items available for sale at discount prices. Especially if you live some place with high population turnover.

– Stop buying crap. If you aren’t willing to lug it across country, you probably shouldn’t own it in the first place.

I don’t even try to buy items from pawnshops these days. You used to be able to find some good deals on tools and the like, but apparently they’re perusing Ebay and the like for pricing and almost always, Craigslist yields a better deal.

Ebay and Amazon have made appliance and tool repair super accessible to anybody with rudimentary Google skills. I fixed my ~10 year old 60 gallon 220v compressor for $19 earlier this year when the check valve in the tank inlet failed. I didn’t even know that it had a check valve there, but a few minutes online and I had it on order.. works great now!

Mr. PoP’s folks have been known to buy jewelry from the pawn shops. Some of the pieces that they’ve gotten there are quite pricey on appraisal, so I don’t like to think about how little the person that pawned the piece would have gotten.

Interesting peak into the world of the poor. I too hate pawn shops and can’t stand going in them. My friend drags me into them from time to time to look at electronics. I’m on board with the comment you made at the end. They aren’t good for society.

Great job fixing your compressor. I fixed my camera a couple weeks ago with 4 hours of good old fashioned labor. I learned quite a bit too and I created zero waste as I used a used part. I have to admit though, it was tempting to throw it out and buy a new one. But to my mustachian mind, that just made zero sense.

They “prey” on lower enlisted men? Let’s let our libertarian flag fly and give our enlisted men some respect. They can make a dumbass decision or two, out of their own free will.

One thing–there is a real culture of buying guns at pawnshops. I think a gun is an ideal product for a pawnshop: it holds its value in contrast to old electronics (sorry commenter above, I think $140 on a year old flat screen is about right, at least for the last ~3 years; you can get a nice new flat screen that size for around $500); guns are often a fairly expensive asset in a low income household (I think a $500 handgun is pretty normal possession for minimum wage worker, whereas the rest of the crap he owns he bought at wal mart and is essentially worthless used).

Don’t know where I’m going with this, but I wanted to stir the pot, so to speak. My guess is that MMM wouldn’t want to live in a nanny state that prohibits consenting adults from entering into contracts, whether it’s to serve their country or pawn their playstation.

Yeah, I don’t know enough about public policy to predict the exact effects of cracking down on predatory lending. Rather than get into the libertarian/nanny-state debate I prefer to make an end run around the whole issue and try to change society itself so there are fewer victims out there.

As for enlisted men – they are badasses, but with many senior officers among my friends now, I get to hear the inside scoop – they are definitely being preyed upon by marketing culture. Young dude, lots of testosterone, big new paycheck. What happens? Jacked up V8 pickup bought on credit, lots of toys, gambling and loans. ALL of these fellas could be instead setting themselves up for a lifetime of financial independence given the right inspiration, and I have heard from one guy who teaches Mustachianism to his deployed subordinates to try to help them prosper (I will add the link below if I can find it in my email).

Pawn shops are in the same shudder-when-you-pass category as payday loan shops and strip joints.

As I often do when I read your stories about construction, carpentry, and repair work, I write myself off as ever being able to do that. Sure, I’m competent with hand tools. And I can fix almost anything on a computer or website. But save a middle school woodshop class, I have no training that would make me feel halfway competent to undertake a DIY furniture project, let alone opening a compressor and fiddling around with springs.

Any tips on how to jumpstart one’s abilities as a Mustachian handyman?

The best tip I have is to just do it. In this case, the air compressor was broken. If MMM couldn’t put it together again, or fix it, it remains broken. All he has lost is some time, but gained a better understanding of how the thing works. If you plan to call a pro (repairman, plumber, electrician), try to fix it yourself first. If you fail, you still call the pro. You haven’t lost anything, but gained knowledge. If you do call a pro, watch them like a hawk and ask questions. That’s what the pros do in trade school or apprenticeship to gain their knowledge!

I am with you J – the husband & I were trying to change out a track light fixture yesterday and we were determined to do it ourselves. We read the instructions in a DIY manual that we have, but when we unhooked the existing fixture, the wires in the box look nothing like the wires shown in the DIY manual pictures. Not wanting to burn the house down, we decided to give it up and will call an electrician to do the job. And here is MMM, fixing his compressor…sigh.
I’m not really sure how to magically create these fix-it powers either.

I bet if you take the fixture off and take a picture of the wiring, and post it to the DIY section in the MMM forums, someone will be able to explain it to you.

My first wiring project I attempted was replacing my front porch light. While I was standing there holding a wire nut and looking puzzled, my neighbour walked by and offered to help. Apparently he’s a contractor. So he explained to me what to do with the ground and showed me how to put on a wire nut, and voila, intro to DIY wiring.

I recommend you consult YouTube or how-to articles for more general explanations of how the electrical system in your home works (or get a book like Wiring 1-2-3 from the library). Once you understand what the wires are actually doing and move beyond “connect the white wire to the white wire” it’s a lot easier to make sense of it – and safer. You can always have an electrician inspect your work (or post the final product to a forum like this) before you turn the breaker back on.

Recently, my husband and I ordered a Mortise Keyless Entry iButton Lock thinking that the local locksmiths would be able to install it for us. Little did we know that none of the 3 locksmiths we called knew how to install it. They stated that they never never installed a Mortise keyless entry before so they would have to learn on the job and charge us an hourly rate of $80 with minimum time of 4 hours.

We said no thanks and proceeded to install the lock ourselves. Sure it may have taken us 15 hours of the course of 2 days but now we know how to install the lock and saved a minimum $320.

And that equation depends on how much work they missed out on by doing this project instead. If you would have been reading a book, or watching TV instead, then it’s not like you were earning any money doing those activities anyway (unless you get paid for those activities).

I used to justify paying for having something done because my time was more worthwhile. I could work for an extra hour on a side project that earned $40/hour. Therefore if I paid someone to do something that took an hour for me to do, and it cost less than $40 for me to pay them, then I thought I was coming out ahead.

But what did I do with that saved time? I didn’t work on the project that paid $40 most of the time. But the justification was still there, and so the money was still spent. It would have been better back then if I had the attitude that I would both work the extra side project AND do the repair work myself, and just have a little less time for surfing the Internet or watching TV.

I am retired so my income is zero. But I did not install the lock, my husband did.

He earns $60 an hour after taxes. Which means our labor actually costed us $900. But he loves working with his hands so he actually enjoyed doing this and feels elated that he is able to do it.

We installed two of these locks so far. Once for his parents and one for mine. We will also be helping a close friend put one in for free.

Beyond these 3 locks, I do not know many more we are going to install, but through this installation we learned how to install all the easier locks plus we know how to drill the holes on steel doors for plates as well.

There are lots of very informative carpentry/construction videos on you-tube. For furniture/cabinetry skills and hints try subscribing to say woodsmith magazine or buy a book at the publications kiosk at one of the big-box stores. The library is even cheaper.

Pawn shops can be great . . . if you’re a buyer, or perhaps the owner. I got my Craftsman socket set there, 1/6th retail, and still with the unlimited warranty! Negotiation is expected, and you can do well on things that don’t ship well (see the ebay comment above), like air compressors. Craigslist should be your go to choice though.

Agreed. We got our Craftsman reel mower for $10,half what the pawn shop had it originally priced for (and way below retail) because they hadn’t been able to sell it for months. I guess most of their customers weren’t in the market for such a Mustachian instrument.

I think a big pawnshop service is disposal of stolen goods. I doubt that most of the stuff in a pawnshop is for loan, it’s for a quick anonymous sale. Plus, even if it was only for people who need a loan it’s the right way to go about it. Collateral and high rates for people with very low credit-worthiness. Sure it’s a bad deal for someone who has access to better terms, but she didn’t so it was the best choice she knew about.

I believe most pawn shops have to keep a list of who they are buying from, to prevent it being a place to fence stolen goods.

Pawn shops (like payday loans) are a kind of shadow banking system for those with no bank accounts or poor credit ratings. People would do better to sell their stuff on Craigslist or Ebay, but pawn shops are much quicker. So people end up, whether they realize it or not, trading money for convenience.

I once had a wet tile saw that I bought for about $60 it obviously wasn’t commercial grade but was great for doing what I needed (occaisional tile cutting for baths and kitchens). One day after five or six years of owning it and multiple uses it decided it didn’t want to turn on so I took it apart checked the wiring and switch, all were fine, then took it apart further – turns out the drum was rusty, I guess that is what happens when you have a cheap wet say with a motor that is not perfectly sealed. Got out the wd-40 and some mild steel wool – presto good as new at least for a while anyway.

If something breaks and the cost of repair is as much as a new item would be (which is almost always the case for power tools and appliances) then my first step is always to try and repair it myself.

If you like compressors that last, you might want to make your next one an oiled compressor. They generally are already built with durability in mind.

I have a Dewalt/Emglo double-hotdog compressor that already has an external regulator that just screws into the tank. Replacing it is a thirty-second job. My father bought the same compressor twenty years ago (back when it was just Emglo). His original Emglo actually blew a tank seam after eighteen years of use, and he replaced it with another identical unit… first stripping the replaceable parts (switch and regulator) off of the old one. Those parts are exactly interchangeable with the “new” ones that we both have.

The tanks of oiled compressors are much less likely to rust as they get some oil blowby past the compressor cylinder, lightly coating the inside of the tank and inhibiting corrosion. If you remember to change the oil every six months or so (more often under heavy use), and you drain the condensation from the tank as instructed, the compressor will last more than eighteen years. Oilless compressors, by comparison, are designed with failure in mind so that you need to buy a new one. This is fine if you’re a contractor and you’re going to blow the motor in a couple years anyway because you run it all day ever day, but it makes no sense for a homeowner or casual contractor who doesn’t run it 12 hours a day, 365 days a year to buy one as they invariably wear out and fail and go to the dump in a couple of years.

“But the spring wasn’t very springy. “Hmm, that’s a clue”, I thought. —>
I pulled the three pieces apart, sprayed some silicone lube onto them, and reassembled. Now the spring was springy. “That will probably work better”, I concluded.”

Ha! That’s basically how I debugged my way through science grad school. Took way longer though… many many years longer.

I had no idea about this aspect of pawn shops. I’ve only ever been on the buying side. They do often have good deals on instruments/amps etc.

Good thoughts on fixing vs. replacing; the luxury of time makes all the difference. One of these days I need to fix my electric dryer, which is making a horrible screeching noise as the drum turns, but since it’s a dryer and I don’t actually need it, I’ll have lots of time to figure it out.

They may be a bad deal for a seller, but I second the idea that it’s not a bad place to shop, especially for tools and musical instruments.

Last year I picked up a gorgeous Stanley #7 Jointer plane from that very same pawn shop for some $15 or $20. About an hour spent cleaning it up, and it was in better shape than any of the $90 ones on eBay.

You have to know what you’re buying though. Don’t plan on returning it if you get it home and it doesn’t work. And don’t be afraid to haggle. The longer something’s been sitting on their shelves, the more willing they are to negotiate. Honestly, I always start with an offer of 50% of the price on the tag. Trust me, they’re not gonna be insulted the way a yard sale-er or craigslist-er would be. The worst they can do is say no.

Remember remote phones we had in our houses in the 80s? Or table top microwaves? At garage sales you could by them for next to nothing and all the phone needed was batteries and the microwave a fuse (usually).

It’s impressive to see you take on these building projects. A friend back in MD owned a painting business and decided to build a house. Ended up becoming one of the largest home builders in the state.

Love your stories MMM. Nice to see you can help build a home, fix a compressor, spend time at a pawn shop and find time to write an excellent post;-)

What, no analysis of how much money per hour you made by fixing it yourself?

Seriously though, I’ve probably saved thousands of dollars myself by fixing barely broken tools and equipment. It seems that half of the problems are either a missing screw or nut or dried out lubrication. I received my snowblower for free (I know you don’t like them) because the self-propel feature didn’t work (missing 1 nut) and the engine didn’t run (quick carb clean). Later the engine started racing due to a sticking governor, a few pennies worth of spray lube and it was back to new.

I got my coffee maker for free as well, only problem was a water line had popped off. One $0.64 hose clamp later I had a $100 coffee maker. If only more people would take a little time to investigate the landfills and pawn shops might not be so full.

Meh. While the “loan” thing does seem crazy, if they just accepted used merchandise for sale I don’t see anything parasitic about that. People just misuse them by accepting the loan rather than selling outright (and getting more money for it when they do).

Maybe I misunderstand, but according to MMM, it’s a loan only business:

At this point, I was shocked to learn something that everyone else apparently knew about pawn shops: when a seller brings in some merchandise, the pawn shop doesn’t buy it outright. Instead, they issue a “loan”, for about one third of the value of the item, and promptly tack on the state-regulated maximum 2% monthly interest fee, and about 20% of miscellaneous bullshit additional fees for “storage and handling”.

I have no experience with pawn shops, so don’t know if there is anything else but the loan option.

Hahaha, awesome story! I try to fix all my own stuff too. I don’t have much time, but every time I fix something it’s a learning experience. That’s worth it in my book. I guess a pawn shop is an option for folks who aren’t very good with their finances, but I would never consider that option. I’d rather sell my crap on Craigslist and get it over with.

That’s a great story. But a weird use of a cuss-alternative. Feather?! Where’s the foul-mouthed MMM we know and love?

This is off topic to this thread, but it’s more general about how much I love MMM, and how much inspiration I get from you guys! I’m so proud of how much I’ve gotten done, financially, and I’m only going up from here. Unless I get screwed by all this government sequestration, but that’s just more motivation to double down and save in the meantime…

I wasn’t censoring myself there, I really do swear in Bird sometimes, as I did when I found out the compressor was dead. Regular swear words become a little old if you overuse them, and I usually have pretty exciting days. So I need to rotate the swearing through several made-up dialects to keep things interesting.

Yuck … Just listening to this story makes me ill. I don’t mind when an adult makes a decision and suffers for it. I don’t like that they suffer but we have free will and everyone has to live their own life. The problem is that the financial difficulties the parents have, lead to suffering by their children.

As to rent to own places, I had no opinion about John Madden one way or another until I saw him do commercials for Rent a Center. Ever since then I can’t stand that guy. I’m sure that if he didn’t do the add, someone else would but at somepoint you have to be responsible for feeding the system. He obviously didn’t need the money.

I’ve seen some free-market types defend check cashing/ rent to own places as a healthy part of consumer choice. I understand choice usually produces better results. To me this would be an obvious exception.

There actually seems to be a pretty strong correlation between the lowly pawn shop and crooked casinos in my experience. After the big casino opened up in my hometown (population 45,000) the count of pawn shops went from 0 to 9! Pretty disgusting results overall.

I love fixing stuff myself – other than learning something valuable and saving money, that hit of self-satisfaction is pretty awesome :)

A tip for wireless routers : if the wireless capability suddenly dies on you for no reason, open it up and have a look. I fixed mine a few years back, by simply wiggling the circuit board back into it’s slot. Took all of 10 minutes, most of which was trying to get the screws off the thing (They don’t make it easy to take apart!).

A colleague was like “Oh, I’ve gone through so many wireless routers because of that type of fault… damn….”

Yes pawn shops are no match for our financial Kung fu. They do not follow the code of the bushido warrior and so must be eliminated. There was a time when they thought of themselves as do-gooders who helped people in financial trouble. Now they are vultures who prey upon non-mustachians, or worse, legalized fencing operations for thieves. With Amazon caving into Nevada legislators and taxing Nevada sales, I love Craigslist. Craigslist has the balance of financial yin and yang. Go in peace. Make mighty with your fixed compressor.

one was of your wife going to serve jury duty and another was this article.

i felt really bad for trishia…i don’t know, if the price had been right and if her mom had been there the first time to get the compressor out of storage, maybe you would have bought it. i just think this was an opportunity to help someone out that hasn’t quite seen the MMM light…

and about the jury duty story. the main jist i got out of the jury duty story is how inconvenient it is to devote a whole day to something. but, since you both are retired and jury duty isn’t keeping you from a job, you are the exact people that should serve jurty duty. it’s part of being in a community. i just thought that article was a little self-centered.

i do like seeing that you do have a donation budget every year so you do try to see things outside of yourselves.

i don’t feel like money should be the dicisive factor at all times.

for instance, i were selling something and someone poor wanted it for less than someone “well off”, i would rather sell it to someone that needed it more and needed more of a “break”…even if they both were willing to pay the same amount, i would sell to the most needy person. do you ever consider those factors in your day-to-day spending/life?

Neuromancer I agree that more should be taken into consideration than just money and I could see how Mr MM could be interpreted as uncaring in the above anecdote however I don’t think Trishia is a real “poor” person, rather she is just someone experiencing the consequences of her own ill-thought-out financial approach. She didn’t even understand the terms of the pawn shop loan properly. Giving money to people like this would maybe help them in the short term, but I don’t think Mr MM got to where he is today by giving money away to silly people. I feel that “big picture” Mr MM is directing his time/money in far more useful ways (such as this blog!).

With the jury duty article I read it more as a joke at themselves that they are complaining about the extreme inconvenience of this ridiculous ordeal they are going through – when really is just what normal people deal with day in, day out. This gives some perspective on how life can be much simpler and more enjoyable following the Mustachian philosophy. I don’t think they were seriously complaining about their participation in jury duty?

Sadly, Pawn Shops are more popular now than they’ve been in years– TV is inundated with shows like Pawn Stars, Hardcore Pawn, Cajun Pawn Stars… that glamorize the profession when, in reality, the majority of pawn shops are opportunists who fleece the poor and disadvantaged. It’s sickening.

There is a local payday loan place near us that advertises a $10,000 loan. In very tiny print it says you pay it back at the rate of $812.00 for 84 months. I thought I read it wrong at first. It makes me want to picket out front, so that folks going in would realize what they are getting into. I was telling my husband this desire and he said, “Great. That is probably what anti-abortion picketers think, that making some poor pregnant desperate person run the gauntlet of picketing forced-birthers will help them see the light.” He put the skids to picketing, but I still wish I could help make it illegal to take advantage of people to that degree.

I just did the math; that works out to ~2.3% interest per month, or ~31% APR. That’s pretty close to the rate you get charged by credit cards if you’re a terrible credit risk, and that’s exactly the target market for paycheck loans. The alternative here isn’t charging less, because that’s a pretty reasonable rate for loaning money to someone with a huge change of defaulting, as a way of offsetting the risk. The alternative is the business not existing at all. And the business exists because the demand exists. You can only stop this business by ending the demand, not the supply.

Note that microcredit organizations like Kiva charge more than that on average, and Lending Club doesn’t charge much less.

I made the obvious mistake in interest rate calculations: I forgot to calculate the interest on the remaining principal rather than the original principal. This *is* the right math to use if computing the rate of return on savings, rather than the payoff of a loan; I blame the mistake on having my mind on savings rather than debt. :)

MMM, it cracked me up to see your comment above about manual hammering being the most dangerous thing carpenters used to do. I used to be a roofer and managed to lose a thumbnail a couple of times due to errant blows.

However, I also managed to shoot a nail through my right hand, so the guns might be worse! Like most roofers, I developed the habit of holding the trigger down and bouncing the tip of the gun (older Senco gun, some of the new ones won’t do this) to shoot nails rapidly. I nailed a piece of flashing over to my right and managed to bump the back of my hand with the gun while my finger was still on the trigger.

Voila, 8d nail through the hand, neatly skewering the first metacarpal on its way through. I had my buddy drive me to the ER, where the admitting nurse flinched when I put my hand on the counter. The doctor was more matter of fact, and after several failed extraction attempts with surgical tools and pliers, he eventually had me hold my hand over a table while he drove the nail back through my hand with a small hammer.

The X-ray showed a neat hole through the bone; it was so fast going through that the bone didn’t even fracture. I was back on the roof two days later, holding that hand up in the air..

All I can say is WOW. I stumbled on your site while researching the evil company that is Comcast cable a little under 2 weeks ago. I ended up reading about the article in which you described internet sharing and getting revenge on the internet company.

I realized that you had other posts and talking about Financial Independence. This theory has actually been an interest of mine for the last couple of years now so i decided to be hardcore and start from the beginning. In the ensuing days of reading, I’ve learned so much about the possibility of early retirement. I just finished reading all your articles to date ending with this one tonight.

I have to say that I think I’m totally on board with this idea and I’m contemplating starting a blog so that I’m able to detail my experience from starting while still in college to financial independence however so long it takes me down the line.

I was curious if MMM, or any experienced Mustachian had any advice for someone who is looking to enter into a job in 2 1/4- 2 1/2 years down the line.

what do you love to do? find a way to do it for money and it won’t feel much like work….save a lot of what you earn and don’t go into debt to buy crap. good luck. reading this blog is a great start in life.

Fortunately I’ve never gotten any debt. I was raised with the mindset that credit card debt was never good and that I should never buy something that I didn’t have money to pay for including paying for cars. The only thing that my parents said that was okay to have debt on was a house and for certain situations, student loans.

Well, I’m 24 right now studying business administration leaning towards accounting. I wasted some time in the community college system because I couldn’t really figure out what I wanted to do. But I would love to work a job for 10 years and be able to leave full time employment.

Agree that pawn shops are not really helping anyone but themselves. But I also learned that those who can least afford to use them seem to think they are necessary. A barely employed (sporadic contract work) distant relative mentioned pawning, for $15, a gift another family member put quite some thought and $110 into acquiring. I noted that Craigslist or Ebay would have netted more. The relative replied they don’t have time for that and can’t be bothered – The most they would get from either of those places is $50, so apparently it was not worth it. The real problem is simply not comprehending, and not wishing to comprehend, the value of money.

Sounds like that’s a job for “Your Money or Your Life”.
The distant relative needs to calculate his or her *actual* hourly wage (including commuting time, unwinding time and monies spent on clothing and dinners out because of the job etc.) to realize that this $35 difference may take a day or more to pay off.
What? You didn’t want to spend a half hour posting the thingamjig on craigslist to earn a WHOLE DAY’s wages?

One of my basic principles in life is “Always take a careful look at the problem before you do anything else.” Many times problems that I thought would require an expensive repair or replacement turned out to have simple situations once I got in there and took a close look at the problem area.

That is so consistent with my findings, also. It’s well worthwhile to analyze the problem and think outside the box, looking at different ways to solve it before acting. That’s one of many things that separate the mustachiams from non mustachians.

Good to know! Sometimes pawn shops would offer you low balling price and then sell it at higher price to someone else.

I got ‘free’ tools from my family as Christmas, Birthday, Housewarming gifts and also Black Friday gifts and not a dime came out of my pocket. I was even told that I should have gone for ‘cheaper’ tools but if I could get ‘free’, high-end tools like Dewalt or Craftsman using gift cards and such, you know what I would do next.

Now I can use those tools to rehab the house I just bought. Cannot wait to get my hands dirty!

I’m going to give you my pawn shop secret. You’ve discovered the most important part: it isn’t a place to sell or get a loan. But… they actually can be a really good place to buy things. (Not always… you have to be prepared to walk out.)

The secret is: find the nicest pawn shop closest to the jail. You’ve probably never spent time in this neighborhood and never noticed, but there will absolutely be a nice clean pawn shop within a block of the city/county jail. This place will be chocked full of high quality items. You will see what appears to be BRAND NEW tools, jewelry, etc. If they want full retail — walk away. But… if they’re willing to sell you a brand new nail gun for 1/2 the cost of new… now we’re talking.

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